@JP: it is more like a cheap replacement for radiosity, since basically ambient occlusion darkens the areas of an object surrounded by other geometry. Without ambient occlusion, diffused lighting is obtained with radiosity, where each surface emits light and basically casts lots of rays which bounce in the scene, and obviously convex areas are less hit since only direct rays reach these spots. With ambient occlusion however you obtain a similar effect using a very simple formula instead of running such a heavy simulation. It has been used widely to reduce rendering times in CG, and only lately implemented in next gen game engines thanks to modern GPU capabilities (you can see screen ambient occlusion in Crysis, for example, though the routine uses a few optimization tricks).